Setting the Record Straight: 32 Questions and Answers on C-32’s Digital Lock Provisions, Part Five

The first four posts on the 32 Questions and Answers on Bill C-32's digital lock provisions focused first on general issues in the bill, second on C-32's circumvention exceptions, third on the missing exceptions, and fourth on consumer-focused provisions in the bill.  This fifth post focuses on business considerations.  For those that want it all in a single package, I've posted the full series as PDF download.

Business Considerations

This section features answers to the following questions:

  • Isn't this just a matter of consumer choice?  If consumers don't want products with digital locks, no one is forcing them to purchase them?
  • Won't the digital lock provisions help bring new businesses to Canada like
  • Are the concerns associated with digital lock provisions in the United States legitimate? What issues have arisen in the U.S. under the DMCA?
  • If these digital lock provisions are too restrictive, what compromises are available?

Isn't this just a matter of consumer choice?  If consumers don't want products with digital locks, no one is forcing them to purchase them?

Of course it is true that no one is forcing a parent to buy an educational or entertainment DVD for their children or for music lovers to purchase CDs.  However, it is not strictly a matter of consumer choice.  For example, I recently spoke at the Canadian Federation of Students annual meeting and was advised by several student leaders that faculties on their campuses were moving to require students to purchase electronic editions of course textbooks.  Students in these programs were not faced with a consumer choice of declining to purchase.  Rather, enrollment in the program mandated the purchase of digitally locked books.  Given the emergence of the Amazon Kindle and Apple iPad, the move toward e-books on university campuses across the country will only increase.  These students do not have the option of declining to purchase items with digital locks.

Won't the digital lock provisions help bring new businesses to Canada like

There is no real evidence to suggest that the anti-circumvention rules found in C-32 will make Canada a more attractive place for digital investments.  The delays associated with or Spotify have little to do with Canadian copyright law.  Rather, they are licence related as the delays in obtaining Canadian licences from rights holders (in the case of Spotify) or the decision of U.S. broadcasters to sell the Internet licenses to Canadian broadcasters (in the case of are the primary source of delays.  In fact, there have been repeated rumours that Hulu will launch shortly in Canada.  Spotify has indicated that it wants to enter the U.S. and Canadian market simultaneously.

Moreover, even the architect of the DMCA has admitted that it has been a failure.  Bruce Lehman, told a McGill audience in 2007 that "our Clinton administration policies didn't work out very well" and "our attempts at copyright control have not been successful."

Are the concerns associated with digital lock provisions in the United States legitimate? What issues have arisen in the U.S. under the DMCA?

The concerns associated with anti-circumvention legislation such as that found in the U.S. DMCA are borne out by 12 years of experience under those rules in the U.S.  Perhaps the most obvious problem has been the use of these legal provisions in cases that have nothing to do with copyright.  The U.S. has been home to a litany of cases involving the DMCA and garage door openers (which involved Canadian-based Skylink), printer cartridge refills, hardware backups, and cell phones.  None of these cases involved attempts to stop copyright infringement.  Rather, they were fundamentally about exerting greater market control by thwarting potential competitors and reducing innovation. 

For example, in the Skylink case, Chamberlain, a competitor in the garage door opener market, tried to stop Skylink from offering a universal garage door remote control.  Chamberlain argued that Skylink needed to circumvent its TPM in order for its remote to function and that this constituted a violation of the DMCA.  While some of the cases have ultimately been dismissed (including, after several appeals, the Skylink case), the mere threat of a lawsuit is frequently enough to dissuade many companies from entering the market or from developing an innovative new product. 

For more on the U.S. experience, see the EFF report: Unintended Consequences: Twelve Years Under the DMCA.

If these digital lock provisions are too restrictive, what compromises are available?

The prior 31 questions identify many necessary reforms to C-32.  As I have noted elsewhere, a starting position should be clarification that it is not an infringing act to circumvent for lawful purposes.  This simple provision would allow the law to target large scale infringement but preserve user rights already contained in the law.  Moreover, lawmakers should consider dropping the ban on the distribution or marketing of devices that can be used to circumvent.  If it is acknowledged that there are legitimate reasons for circumventing a digital lock, Canadians should be able to legally acquire the tools they need to do so.

The prior discussion has also identified a range of additional compromise reforms.  These include:

  • the identification of "qualified circumventers" to allow Canadians without technical expertise to exercise their rights
  • the removal of the lock requirements for digital lessons and digital inter-library loans
  • the establishment of an impartial review process for new circumvention rights
  • the extension of the encryption research exception to all research
  • fixing the privacy and perceptual disability exceptions so that circumvention devices can be lawfully obtained
  • extension of the interoperability exception
  • a requirement on rights holders to unlock locked content in appropriate circumstances
  • exclude non-infringing access controls from their anti-circumvention legislation
  • establish a new exception for personal use
  • establish a new exception for preservation of digital materials
  • establish a new exception for the protection of minors
  • establish a new exception for filtering software
  • establish a new exception for obsolete or broken locks
  • establish a new exception for court cases, laws, and government documents
  • establish a new exception for public domain works
  • remove the lock requirements on the time shifting, format shifting, and backup copy provisions
  • require businesses that use TPMs to include a prominent warning on their packaging

Specific legislative language related to these recommendations will be posted tomorrow.


  1. Institutionalization of higher education
    is the reason why universities can require students to purchase expensive textbooks. With electronic books, they kill the second-hand market, yet they retain control over prices. But the profound reason is that we think that only universities may give higher education, with even students blaming “they did not teach me XYZ!!!1”. I think we should treat them the same way we should treat the Certification Authorities after the “compelled certificate creation” debacle: one of the many places, but not monopolies.

  2. Jack Robinson says:

    B-32 Bitch’s Brew
    At the risk of being deemed OCD by my repeated posts to this and other sites that, in my deranged estimation… Bill C-32 has far more sinister significance for Canadians than sexy, over-hyped Digitized Media Access issues… than our current New Rome government’s sly agenda for creating an ‘illegal by default’ mechanism for criminalizing surly citizen consumers according to their Milton Friedman-inspired toxic principles of Capitalist food-chain entitlement, market control and penury for the disenfranchised.

    But hey, Kidz… I’ve been readin’ Naomi Klein between the sheets past curfew… and she gets my tiny pecker up!

  3. Strictly speaking, it should be a matter of consumer choice.
    The real problems with this statement I think are:
    – Monopolies / Collusion – When nearly everyone gets together and agrees to use DRM, consumer choices are limited.
    – Deception – Companies are not even remotely up front about when and how they use digital locks, nor for what purpose(s). Consumer choice requires better transparency.
    – History / Retroactiveness – People already had lots of media, software, etc that include digital locks long before this idea of making it illegal to circumvent them for legal purposes was even a glimmer in an RIAA exec’s eye. These formats which include DRM have now become standards, even though they possibly wouldn’t have if this law had been in effect (especially if it were thoroughly enforced) when the formats were released. Changing these standards when you have already throughly adopted them is costly and difficult. If you ask me, if this sort of law is passed, everyone should be able to seek recompense for anything they purchased under such false pretenses that no longer suits their purposes, as well as any aditional costs of migrating to a solution that will work for their purposes now that they can no longer circumvent the DRM legally.

  4. As the lack of any digital lock on a work under C32 can be taken to be logically equivalent to the copyright holder granting permission to copy a work for purposes that are specifically permitted by fair dealing, C32 seems to say, in a nutshell, that you cannot copy a copyrighted work for *ANY* reason without permission from the copyright holder.

  5. >Won’t the digital lock provisions help bring new businesses to Canada like

    How is it going to make Hulus DRM work all of a sudden compared to now? Is there some Canadian beaver magic in the air that automatically unlocks Hulus’s DRM when it reaches a Canadian based computer?

    Anyways let them introduce it, it wont stop me from ripping my dvd’s so I can watch them through my HTPC. It will make me stop from buying all new media/movies/music and going to the movies unless I can get it second hand for dirt cheap. Going bowling instead of the movies and then hitting a pawn shop a few days after the DVD release to get a dvd for $2-4 is much more fun.

  6. cndcitizen says:

    Has anyone asked what we are trying to do?
    Seriously…has the canadian economy been affected by friends sharing anything? Has inovation been reduced….I am thinking that in fact one of the only contries that have weathered the storm or downturn is Canada. We have tight regulations on banks and inovation, we don’t allow monopolies and we are basically saying, if it is not broke don’t fix it. You don’t see movies not being released in Canada, or music, if you really put a vote for copyright, you would see it in line with Patent laws, or like something like 3-5 years protection. This gives ample time to retrieve the moneys, or any that you will get if your product is good to cover your costs.

    Entertainment is getting cheaper and cheaper and sooner or later it will be more sharing of you tube to make people laugh harder then going and paying 50$ to watch a 1.5 hour movie with the missus that is borderline at best.

  7. C32 fundamentally is against opensource says:

    Well C32 means I can’t compete with Microsoft or Apple
    In fact it puts me out of business, who wants to buy a high quality but low-cost Linux Desktop that can’t play DVDs?

    No one.

  8. RE: Opensource
    I don’t necessarily thing C-32 is specifically against opensource. C-32 is extremely capitalistic and anti-inovative in it’s nature where opensource generally strives to be inovative and most often does not have monetary gain (If any) as a driving factor. They contradict eachother as much as oil and water.

  9. No term for conflicts of interest
    The corporate cartels want to sell us a license to an intangible and/or a tangible product. If we keep buying from them, they don’t really care if we enjoy the product, as long as we keep giving them money every time we use our license. They want to own everything, and want us to own (basically nothing, but market forces won’t allow it) only a license, even to use a tangible product. Since selling us a tangible product once was not adequate, their greed has shifted to selling us a license per usage. It is most profitable, when they use the money-per-time ($/time) model rather than the $/product model. If they are allowed to charge for every breath we take, they will do it.

    There is a misconception that says the value of an intangible product nears zero, when it can be digitally copied infinitely. This is true for works of mediocre and inferior quality; however, for works of exceptional quality, the near opposite is true. C32 empowers the corporate cartels to sell inferior quality while demanding entitlements (legal threats) and profits.

    For a political party that, I think, believes in market freedom, competition, innovation, and all the things we like to hear – the Harper government has drafted a bill that is against everything they’re telling us. There is no proof the Harper government is favouring market freedom, competition, innovation, etc. If they can’t learn from the failures of the DMCA in 12 years and still propose anti-circumvention laws, they’re obviously uninterested in market freedom, competition, innovation, etc.

    If students only have 30 days to keep certain lessons after their course’s conclusion, why does a copyright board member have 120 days to resign in a conflict of interest? People can do a lot in 119 days in a conflict of interest. When will Harper’s and his ministers’ conflict of interest end? It’s funny where it doesn’t seem to end, unless they’re unelected.

    The Copyright Act:
    Conflict of interest prohibited
    66.3 (1) A member of the [Copyright] Board shall not, directly or indirectly, engage in any activity, have any interest in a business or accept or engage in any office or employment that is inconsistent with the member’s duties.

    Termination of conflict of interest
    (2) Where a member of the Board becomes aware that he is in a conflict of interest contrary to subsection (1), the member shall, within one hundred and twenty days, terminate the conflict or resign.

  10. RE: No term for conflicts of interest
    “If students only have 30 days to keep certain lessons after their course’s conclusion…”

    Not just students, I work in post-secondary and it’s my understanding the instructors must do the same and build new lessons every semester or risk being in violation of copyright. This could have terrible consequences for students and academics alike. Assignments are no longer interoperable and become a potential copyright infringement to use, there could potentially a lack of consistencey in course material from semester to semester and there will certainly be an added cost if lesson plans have to be constantly rebuilt…a cost that will almost certainly be passed on to the student.

    This will make post-secondary more expensive and less accessible to ALL students and researchers. They’re changing an education model that has worked well for hundreds of years…all to make a few bucks. If they’re worried about digital sharing ONLY DO PRINT COPIES!!! Of course this isn’t the concern, what they’re really after is to be able to kill second hand sales….money, money, money. All on the backs of students, many of whole are on loans to be there. Makes me sick!!

    Strict copyright rules and controls has no place in education or research. There are already rules, tools and processes available to ensure plagiarism is limited.

    These education restrictions, along with the, TPM (Anti-private-use) protections are SERIOUS issues with this legislation.

  11. Market control of mobile devices
    I’m happy to see your write (Ottawa Citizen 10Jun22) about the tightly controlled cellphone marketplace. I own an “unlocked” phone and can’t get service I want without them pushing another “free” phone and expensive contracts. For now I’m using it as a GPS, wifi, calendar, game device.
    The real crime is because I did not buy it from a provider, my Android system does not include the “Market” icon – basically you can’t add it and you can’t buy any of the apps without it. I often take time to email companies that sell apps on the Android Market to tell them what I think of market monopolies. One ray of hope is emergence of 3rd party sellers – where I now can buy apps.

  12. Corporate Control
    For me the bottom line is that the Bill would put the corporate owner in direct control of my personal media. In the end, more money is extorted out of the consumer than they can afford. In general I feel that such measures will slow the multimedia market and reduce the ease of widespread popularity for said media.

    Of course, somebody will break through the established countermeasures. They always do. Look at the PS3 of late.